By Himanshi Akhand
Nov 22 (Reuters) – Malaysian stocks weakened for the second straight day on Tuesday, while the ringgit see-sawed as a political deadlock in the country extended after the incumbent ruling coalition decided not to support any alliance to form a government.
Most other emerging Asian currencies bounced back from Monday’s losses as the US dollar retreated after an overnight rally, even as China’s COVID-19 case rose further. USD/
the ringgit MYR= swung between marginally positive and negative territory as state news agency Bernama reported Malaysia’s King Al-Sultan Abdullah would pick the next prime minister, without specifying a time for the decision.
Saturday’s general election resulted in an unprecedented hung parliament and the lack of clarity since then has raised the risk of delaying policy decisions and complicating potential fiscal repair.
“The lower move for the USD/MYR has been rather sharp and the political uncertainties at home spurred a mild bullish retracement yesterday,” analysts at Maybank said in a note.
The uncertainty also hit equities in Kuala Lumpur .KLSEwhich fell 0.8%, as significant election gains by an Islamist party added to investors’ fears over policies on gambling and alcohol consumption.
Other regional currencies edged higher. The Singapore dollar SGD= and Thai baht THB=TH were up 0.1% and 0.3%, respectively.
Regional stock indexes were mixed. Equities in the Philippines .PSI rose as much as 0.9% to their highest since Sept. 20. Thai stocks .SET were little changed after two sessions of gains.
** Malaysia’s 10-year benchmark yield is down 0.3 basis points at 4.398%
** Top losers on FTSE Bursa Malaysia Kl Index .KLSE include Top Glove Corporation Bhd TPGC.KL and Maxis Bhd MXSC.KL
** Singapore’s Q3 GDP and October CPI data due on Wednesday
Asia stock indexes and currencies at 0634 GMT
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Graphic: World FX rates https://tmsnrt.rs/2RBWI5E
Asian stock marketshttps://tmsnrt.rs/2zpUAr4
(Reporting by Himanshi Akhand in Bengaluru; Editing by Savio D’Souza)
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